Exhibit 10.56
17
OPTION AGREEMENT
TOCANTINZINHO PROJECT - BRAZIL
THIS AGREEMENT is dated for reference the 31st day of July, 2003.
BETWEEN:
▇▇▇▇▇▇ ▇▇▇▇▇ of Privada de la Ca ▇▇▇▇▇ 8
San ▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇▇▇
and
▇▇▇▇ ▇▇▇▇▇▇ of ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇,
▇▇▇▇▇▇
(hereinafter referred to as the "Optionors")
OF THE FIRST PART
AND:
STAR RESOURCES CORP., a company incorporated under
the laws of the Province of British Columbia and having its
registered office at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇
(hereinafter referred to as the "Optionee")
OF THE SECOND PART
WHEREAS:
A. Pursuant to a letter agreement (the "Garimpo Agreement") dated April 9,
2003 between Manoel da Concei o ▇▇▇▇▇▇▇▇, ▇▇▇▇ Francisco Feltrim and
Lourival Viriato Mendon a (collectively, the "Owners") and the Optionors,
the Optionors have the option to purchase 100% of certain mineral claims
which constitute the Garimpo Mining License more particularly described in
Schedule "A" attached hereto and forming part of this Agreement (the "Core
Mineral Claims");
B. Pursuant to a letter agreement (the "Peripheral Claims Agreement") dated
April 15, 2003 between Austral-AGS do Brasil Ltda and the Optionors, the
Optionors have the option to purchase 100% of certain mineral claims which
constitute claims adjacent to the Garimpo Mining License more particularly
described in Schedule "B" attached hereto and forming part of this
Agreement (the "Peripheral Claims Agreement");
C. The claims described in recitals A and B are collectively referred to in
this agreement as the "Mineral Claims"; and
D. The Optionors desire to grant an option to purchase a 100% interest in the
Mineral Claims to the Optionee and the Optionee is desirous of obtaining an
option to purchase the interest upon the terms and subject to the
conditions herein contained.
NOW THEREFORE in consideration of the premises and of the mutual covenants and
promises herein contained, the parties hereto agree as follows:
1. GRANT
1.1 The Optionee and its employees and agents and any person duly authorized by
the Optionee shall have the sole and exclusive right and option to:
(a) enter upon the Mineral Claims;
(b) have exclusive and quiet possession thereof for the purposes of
prospecting, exploration, development or other mining work;
(c) do such prospecting, exploration, development or other mining work
thereon and thereunder as the Optionee in its sole discretion may consider
advisable;
(d) bring upon and erect upon the Mineral Claims such mining facilities as
the Optionee may consider advisable; and
(e) remove from the Mineral Claims and sell or otherwise dispose of
reasonable quantities of any mineral products derived therefrom, for the
purpose of obtaining assays or making other tests.
The right and option given and granted under this Section 1 is hereinafter
called the "working option".
2. PAYMENTS AND COMMITMENTS
2.1 In order to maintain the working option in good standing and to earn the
100% interests in the Mineral Claims, the Optionee shall:
(a) make the following cash payments to the Optionors:
(i) $75,000 on the "Closing Date" as defined later in this agreement;
(ii) $30,000 6 months from the Closing Date;
(iii) $40,000 12 months from the Closing Date;
(iv) $40,000 24 months from the Closing Date;
(v) $130,000 36 months from the Closing Date; and
(vi) $150,000 48 months from the Closing Date.
(b) incur at least $1,000,000 in exploration work ("Qualified
Expenditures") on or for the benefit of the Mineral Claims, of which
$300,000 shall be expended prior to the first anniversary of the
Closing Date. "Qualified Expenditures" shall refer to payments
incurred for exploration and development activities directed towards
disclosure and definition of an ore body on the property, including
payments required to maintain the claims and Underlying Agreements in
good standing, the payments under the Consulting Agreement set out in
Schedule "D" and the payments referred to in section 2.1(a).
(c) issue 2,600,000 fully paid shares of the Optionee to the Optionors on
the following basis:
(i) 1,100,000 shares on the Closing Date;
(ii) 200,000 shares 6 months from the Closing Date;
(iii) 200,000 shares 12 months from the Closing Date;
(iv) 200,000 shares 24 months from the Closing Date;
(v) 200,000 shares 36 months from the Closing Date; and
(vi) 700,000 shares 48 months from the Closing Date.
If there shall, prior to the issuance of any of the shares hereunder,
be any reorganization of the authorized capital of the Optionee by way
of consolidation, merger, subdivision, amalgamation or otherwise, then
there shall automatically be an adjustment in the number of shares of
the Company which may be issued hereunder by corresponding amounts so
that the rights of the Optionors hereunder shall thereafter be
equivalent to those originally granted hereunder.
(d) The Optionee will, of and from the Closing Date, assume all
obligations of the Optionors relating to the Owners and the Mineral
Claims (including without limitation, the obligations of the Optionors
under the Garimpo Agreement and the Peripheral Claims Agreement
(collectively, the "Underlying Agreements"). Furthermore, in the event
that the Optionee elects to terminate this Option Agreement, it may do
so subject to section 8 and section 3(a), (b) and (c) but shall
terminate with at least 15 days advance notice of payment due dates
that pertain to the Garimpo Agreement and the Peripheral Claims
Agreement.
2.2 The payments, expenditures and share issuances, except for the payments
described in paragraph 2.1(a)(i), 2.1(c)(i) and the expenditure of $300,000
prior to the first anniversary of the Closing Date, are optional and the
Optionee shall not be obliged to make or incur them.
3. ACQUISITION OF INTEREST
3.1 Upon completion of the payments pursuant to paragraph 2.1(a), completion of
the exploration work specified in paragraph 2.1(b) and delivery of the
shares pursuant to paragraph 2.1(c), the Optionee shall have earned 100% of
the Optionors' interest in and to the Mineral Claims subject to any ongoing
obligations under the underlying agreement and subject to the royalty (the
"Royalty") described in Schedule "C" attached hereto.
4. CLOSING AND CONDITIONS THERETO
4.1 The Closing of this agreement shall occur at 2:00 p.m. Vancouver time on
the 2nd business day (the "Closing Date") following the satisfaction of the
conditions set out in Section 4.3 hereof at the registered office of the
Company.
4.2 At the Closing, the Optionee will deliver to the Optionors the funds and
shares described in Section 2.1(a)(i) and 2.1(c)(i).
4.3 The Closing of this agreement shall be conditional upon the following,
which are conditions for the sole benefit of the Optionee and which the
Optionee undertakes to diligently and with reasonable haste attempt to
satisfy, namely:
(a) the acceptance of the TSX Venture Exchange of this agreement; and
(b) the completion of legal and technical due diligence on the Mineral
Claims to the satisfaction of the Optionee. If the conditions are not
satisfied by August 31, 2003 or such other date acceptable to the Optionors
and the Optionee, this agreement shall be terminated and of no further
force and effect.
5. ADDITIONAL MINERAL CLAIMS
5.1 The Optionee wishes to have the opportunity to examine and possibly acquire
additional mineral interests in the Tapajos Region of Brazil and
accordingly, the Optionors agree that any additional properties within
the Tapajos Region which become known to or are acquired by the Optionors
will first be offered to the Optionee for acquisition.
6. COVENANTS OF OPTIONEE
6.1 During the currency of this Agreement, the Optionee shall:
(a) keep the Mineral Claims free and clear of all liens, charges and
encumbrances; comply with all applicable laws, rules and regulations; and
carry out operations in a good and workmanlike manner in accordance with
generally accepted mining practice;
(b) maintain the Mineral Claims and the Underlying Agreements in good
standing;
(c) not breach or fail to fulfil, perform or observe the terms and
conditions of or pertaining to the licenses comprised in the Mineral
Claims;
(d) provide to the Optionors within 30 days of the end of each calendar
quarter during which any Qualified Expenditures have been incurred
comprehensive written reports showing the operations carried out and the
results obtained and detailing the Qualified Expenditures incurred together
with evidence of payment thereof. The Optionors shall at all reasonable
times have access to the Mineral Claims, provided that the Optionors will
not interfere with the Optionee's operations hereunder. The Optionors will
have the right from time to time on reasonable notice to the Optionee to
audit and make copies of the books and records of the Optionee which are
relevant to Qualified Expenditures; and
(e) indemnify and save harmless the Optionors from and against any and all
claims, debts, demands, suits, actions and causes of action whatsoever
which may be brought or made against the Optionors by any person, firm or
corporation and all loss, costs, damages, expenses and liabilities which
may be suffered or incurred by the Optionors arising out of or in
connection with or in any way referable to, whether directly or indirectly,
the entry on, presence on, or activities on the Mineral Claims or the
approaches thereto by the Optionee or its servants or agents including
without limitation bodily injuries or death at any time resulting therefrom
or damage to property.
(f) The Optionee will retain ▇▇▇▇▇▇ ▇▇▇▇▇ as a consultant in accordance
with the Consulting Agreement attached as Schedule "D".
7. REPRESENTATIONS AND WARRANTIES OF THE OPTIONORS
7.1 The Optionors make the following representations and warranties to the
Optionee:
(a) To the best of the knowledge of the Optionors, each of the Mineral
Claims has been validly located, filed and recorded in compliance and are
in good standing with the laws of the Brazil and the State of Para as they
relate to location and recordation of such claims;
(b) The Underlying Agreements are in good standing and are valid and
enforceable in accordance with their respective terms; and
(c) The Optionors have the sole and complete power to deal with the
Underlying Agreements and Mineral Claims as herein contemplated.
7.2 The representations and warranties of the Optionors are conditions upon
which the Optionee has relied in entering into this Agreement and shall
survive the acquisition of the Mineral Claims by the Optionee. The
Optionors will indemnify and save the Optionee harmless from all loss,
damage, costs, actions and suits arising out of or in connection with any
breach of any representation, warranty, covenant, agreement or condition
contained in this Agreement. The Optionors acknowledge and agree that the
Optionee has entered into this Agreement relying on the warranties and
representations and other terms and conditions of this Agreement and that
no information which is now known or which may hereafter become known to
the Optionee or its officers, directors or professional advisors shall
limit or extinguish the right to indemnity hereunder
8. TERMINATION PRIOR TO ACQUISITION OF MINERAL CLAIMS
8.1 Subject to paragraph 2.2, this Agreement may be terminated prior to
exercise of the option by 60 days notice in writing from the Optionee to
the Optionors;
8.2 This agreement will terminate:
(a) subject to section 10, upon default by the Optionee;
(b) if the Optionee becomes insolvent, makes any assignment in bankruptcy
or makes any other assignment for the benefit of creditors, makes any
proposal under the Bankruptcy Act (Canada) or any comparable law, seeks
protection or relief under the Companies Creditors Arrangement Act (Canada)
or under any bankruptcy, insolvency or analogous law, is adjusted bankrupt,
files a petition or proposal to take advantage of any act of insolvency,
consents to or acquiesces in the appointment of a trustee, receiver,
receiver and manager, interim receiver, custodian or other person with
similar powers of itself or of all or any substantial portion of its
assets, or files a petition or otherwise commences any proceeding seeking
any reorganization, arrangement, composition or readjustment under any
applicable bankruptcy, insolvency, moratorium, reorganization or other
similar law affecting creditors' rights or consents to, or acquiesces in,
the filing of such a petition; or
(c) if the Optionee does not exercise the option as described in section
3.1
8.3 If the Option is terminated pursuant to this section, the Optionee shall
within 30 days:
(a) deliver to the Optionors copies of all of the non-interpretative
reports, maps, plans, photographs, digital data and drill logs of the
Optionee relating to the Mineral Claims, provided that the Optionee does
not make any representation or warranty concerning the accuracy or
completeness thereof;
(c) leave the working and camp site in a clean and environmentally
acceptable condition; and
(d) fulfill all reclamation obligations required by Brazilian law arising
out of the Optionee's activities on the Mineral Claims.
(e) deliver to the Optionors, documents of transfer of any exploration
licenses which the Optionee may have acquired underlying the area covered
by the Mineral Claims.
9. FORCE MAJEURE
9.1 If the Optionee is prevented or delayed in complying with any provisions of
this Agreement by reason of strikes, lockouts, labour shortages, power
shortages, fires, wars, acts of God, governmental regulations restricting
normal operations, the time limited for the performance of the various
provisions of this Agreement as set out above shall be extended by a period
of time equal in length to the period of such prevention and delay. The
Optionee, insofar as is possible, shall promptly give written notice to the
Optionors of the particulars of the reasons for any prevention or delay
under this paragraph, and shall take all reasonable steps to remove the
cause of such prevention or delay and shall give written notice to the
Optionors as soon as such cause ceases to subsist.
10. DEFAULT
10.1 If the Optionee should be in default in performing any requirement herein
set forth, the Optionors shall give written notice to the Optionee
specifying the default and the Optionee shall not lose any rights granted
under this Agreement, unless, within 60 days after the giving of a notice
of default by the Optionors, the Optionee has failed to take steps to cure
the default by the appropriate payment or performance the Optionee hereby
agreeing that should it so commence to cure any defect it will prosecute
the same to completion without undue delay); and if the Optionee fails to
take reasonable steps to cure any such default, the Optionors shall be
entitled thereafter to terminate this Agreement and the provisions of
paragraph 8 shall then be applicable.
11. NOTICE
11.1 Any notice required to be given under this Agreement shall be deemed to be
well and sufficiently given if delivered by hand or if emailed with
delivery receipt requested addressed as follows:
▇▇▇▇▇▇ ▇▇▇▇▇ of Privada de la Ca ▇▇▇▇▇ 8
San ▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇▇▇
Email: ▇▇▇▇▇▇▇▇▇▇▇@▇▇▇▇▇.▇▇▇
and
▇▇▇▇ ▇▇▇▇▇▇ of ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇, ▇▇▇▇▇▇
Email: ▇▇▇▇▇▇▇▇▇@▇▇▇▇▇.▇▇▇
and in the case of the Optionee addressed as follows:
STAR RESOURCES CORP.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Email: ▇▇▇▇▇▇▇▇▇▇▇▇@▇▇▇.▇▇▇
with a copy to:
DuMoulin Black
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Attention: ▇▇. ▇▇▇▇▇ ▇. ▇▇▇▇▇
Email: ▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
and any notice given as aforesaid shall be deemed to have been given, if
delivered, when delivered or if emailed, on the next business day after the date
of receipt by the sender of the delivery receipt message. Either party may from
time to time by notice in writing change its address for the purpose of this
paragraph.
12. OPTION ONLY
12.1 This is an option only and except as specifically provided otherwise,
nothing herein contained shall be construed as obligating the Optionee to
do any acts or make any payments hereunder and any act or acts, or payment
or payments as shall be made hereunder shall not be construed as obligating
the Optionee to do any further act or make any further payment. If this
Agreement is terminated the Optionee shall not be bound thereafter in debt,
damages or otherwise under this Agreement save and except as provided for
in paragraph 8 and with respect to obligations arising from termination;
and all payments theretofore paid by the Optionee shall be retained by the
Optionors in consideration for entering into this Agreement and for the
rights conferred on the Optionee thereby.
13. PAYMENTS
13.1 All amounts referred to under this agreement shall be in United States
Dollars. Any payments to the Optionors which the Optionee may make under
the terms of this Agreement shall be paid to ▇▇▇▇▇▇ ▇▇▇▇▇ on behalf of the
Optionors and shall be immediately available in United States funds and
shall be deemed to have been well and sufficiently made in timely manner if
cheques payable to the Optionors are mailed to the Optionors at the address
stipulated for receiving notices hereunder by prepaid registered mail from
a point in Canada or the United States on or before the date such payment
is to be made.
14. FURTHER ASSURANCES
14.1 The parties hereto agree to execute all such further or other assurances
and documents and to do or cause to be done all acts or things necessary to
implement and carry into effect the provisions and intent of this
Agreement.
15. TIME OF ESSENCE
15.1 Time shall be of the essence of this Agreement.
16. TITLES
16.1 The titles to the respective paragraphs hereof shall not be deemed as part
of this Agreement but shall be regarded as having been used for convenience
only.
17. SUCCESSORS AND ASSIGNS
17.1 This Agreement shall enure to the benefit of and be binding upon the
parties hereto and their respective heirs, executors, administrators,
successors, and assigns provided any such assignee agrees in writing to be
bound by the terms of this Agreement and provided that any assignee shall
be required the prior written consent of the non-assigning party, such
consent not to be unreasonably withheld. The Optionee shall not require the
consent of the Optionors to assign its interest hereunder to a wholly owned
subsidiary of the Optionee.
18. GOVERNING LAW
18.1 This Agreement shall be governed by and interpreted in accordance with the
laws of the Province of British Columbia.
19. PRIOR AGREEMENTS
19.1 This Agreement supersedes and replaces all prior agreements between the
parties hereto with respect to the Mineral Claims, which said prior
agreements shall be deemed to be null and void upon the execution hereof.
IN WITNESS WHEREOF the parties have hereunto to have effect, caused their common
seal(s) to be affixed in the presence of their proper officers duly authorized
in that regard the day and year first above written.
STAR RESOURCES CORP.
Per: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
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Authorized Signatory
SIGNED, SEALED AND DELIVERED
BY ▇▇▇▇▇▇ ▇▇▇▇▇ in the presence of:
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Name
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇
--------------------
▇▇▇▇▇▇ ▇▇▇▇▇
Address
Occupation
SIGNED, SEALED AND DELIVERED )
BY ▇▇▇▇ ▇▇▇▇▇▇ in the presence of:
-----------------------
Name
/s/ ▇▇▇▇ ▇▇▇▇▇▇
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▇▇▇▇ ▇▇▇▇▇▇
Address
Occupation
SCHEDULE "A"
REFERRED TO IN THE AGREEMENT DATED FOR REFERENCE THE 31ST DAY OF JULY, 2003
BETWEEN ▇▇▇▇▇▇ ▇▇▇▇▇ AND ▇▇▇▇ ▇▇▇▇▇▇ AND STAR RESOURCES CORP.
MINERAL CLAIMS
Garimpo gold Licenses located in the Municipality of Itaituba, State of
Para, Brazil and registered under DNPM Numbers 854.442/95 to 854.521/95
inclusive and covering an area of 4,000 Hectares.
SCHEDULE "B"
REFERRED TO IN THE AGREEMENT DATED FOR REFERENCE THE 31ST DAY OF JULY, 2003
BETWEEN ▇▇▇▇▇▇ ▇▇▇▇▇ AND ▇▇▇▇ ▇▇▇▇▇▇ AND STAR RESOURCES CORP.
Exploration Licenses located in the Municipality of Itaituba, State of
Para, Brazil and registered under DNPM Numbers 850.196/2003, 850.197/2003
and 850.198/2003 covering an area of 24,275 Hectares.
SCHEDULE "C"
REFERRED TO IN THE AGREEMENT DATED FOR REFERENCE THE 31ST DAY OF JULY, 2003
BETWEEN ▇▇▇▇▇▇ ▇▇▇▇▇ AND ▇▇▇▇ ▇▇▇▇▇▇ AND STAR RESOURCES CORP.
ROYALTY PROVISIONS
1.01. Star Resources Corp. ("Star") hereby grants to ▇▇▇▇▇▇ ▇▇▇▇▇ and ▇▇▇▇
▇▇▇▇▇▇ (the "Royalty Holders") participation in the future revenues derived
from sales of gold (in whatever form and whether or not incorporated into
other products), mined from the Tocantinzinho Project (the "Royalty"). The
Royalty shall be payable, in United States dollars by Star to ▇▇▇▇▇▇ ▇▇▇▇▇
on behalf of the Royalty Holders and their heirs, successors and assigns on
or by the 60th day after the end of each fiscal quarter.
The Royalty for each fiscal quarter with respect to sales of gold mined
from the Tocantinzinho Project will be calculated as follows:
(XG) MULTIPLIED BY (Z%)
Where:
XG = The number of ounces of gold sold by Star for which Star has
received payment in full during the immediately preceding fiscal
quarter multiplied by the Average Gold Price for such fiscal quarter
Z = 2.5, if the Average Gold Price for such fiscal quarter is less
than $400 per ounce;
2.75, if the Average Gold Price for such fiscal quarter is equal to or
greater than $400 and less than $450 per ounce;
3.0, if the Average Gold Price for such fiscal quarter is equal to or
greater than $450 per ounce and less than $500 per ounce; or
3.5, if the Average Gold Price for such fiscal quarter is equal to or
greater than $500 per ounce.
Notwithstanding any provision to the contrary in this Section 1.01, the
Parties hereby agree and acknowledge that (a) Star shall not, by reason
only of this Section 1.01, be obligated to develop or exploit, or to cause
the development or exploitation of, the Tocantinzinho Project, or otherwise
to cause Star to sell, at any particular time or in any particular amounts,
gold mined from the Tocantinzinho Project.
1.02. Default Interest. Star hereby agrees that any amounts due to the Royalty
Holders pursuant to Section 1.01 and not paid within 60 days following the
end of such fiscal quarter shall accrue interest at the Base Rate plus 3.0%
per annum.
1.03. Definitions. The following terms shall have the following meanings:
"Average Gold Price" means, with respect to any fiscal quarter, the average
of the London P.M. Gold Price Fixes, if any, for each day during such
fiscal quarter.
"Base Rate" means, a fluctuating interest rate per annum in effect from
time to time, which rate per annum shall at all times be equal to the rate
of interest announced publicly by Citibank N.A. in New York, New York, from
time to time, as Citibank N.A.'s base rate.
"London P.M. Gold Price Fixes" means, for any day, with respect to (a) gold
from concentrate, the London final gold prices for such day as published in
▇▇▇▇▇'▇ Metals Week (or, if such publication is no longer available, such
other leading publication for London gold prices as may be determined by
Star in its reasonable discretion); and (b) gold from dore , the fixing per
fine ▇▇▇▇ ounce (in U.S. dollars) for gold as announced at the afternoon
London Gold Fixing for such day; provided that, if (a) the afternoon London
Gold Fixing shall not have occurred for such day, the "London P.M Gold
Price Fixes" for gold from dore for such day shall be the fixing price per
fine ▇▇▇▇ ounce (in U.S. dollars) for gold as announced at the morning
London Gold Fixing for such day; and (b) the London Gold Fixing shall no
longer be a leading indicator of gold prices, such other index as may be
selected by Star in its reasonable discretion shall be used to determine
the "London P.M. Gold Price Fixes" for purposes of this Agreement.
SCHEDULE "D"
REFERRED TO IN THE AGREEMENT DATED FOR REFERENCE THE 31ST DAY OF JULY, 2003
BETWEEN ▇▇▇▇▇▇ ▇▇▇▇▇ AND ▇▇▇▇ ▇▇▇▇▇▇ AND STAR RESOURCES CORP.
CONSULTING AGREEMENT
CONSULTING SERVICES AGREEMENT
THIS AGREEMENT made as of the 31st day of July, 2003.
BETWEEN:
▇▇▇▇▇▇ ▇▇▇▇▇
Recreo ▇▇▇, ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇▇
(hereinafter called the "Consultant")
OF THE FIRST PART
AND:
STAR RESOURCES CORP.
c/o 10th Floor, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇
(hereinafter called the "Company")
OF THE SECOND PART
WHEREAS:
A The Company is desirous of engaging the Consultant, and the Consultant is
ready, willing and able, to carry out and provide advisory and consulting
services (the "Work") on the terms and conditions, herein set forth.
NOW THEREFORE THIS AGREEMENT WITNESSES THAT, in consideration of the premises
and of the sums herein provided to be paid by the Company to the Consultant, and
of the mutual covenants and undertakings to be performed hereunder, the parties
agree as follows:
ARTICLE I
AGREEMENT TO PROVIDE CONSULTING SERVICES
1.01 The Consultant will carry out the Work for the Company in the areas and the
rates described in Schedule "A" hereto for a period of 18 months, subject
to adjustment as described in Section 5.01 hereof.
1.02 The Consultant will carry out the Work in consultation with and under the
direction of ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇, President of the Company and covenants to
conduct the Work in a businesslike manner, in keeping with professional
practices in the industry and in a safe and lawful manner.
ARTICLE II
REPORTING
2.01 The Consultant will, if required, provide the Company with regular progress
reports, in such form as the Company may reasonably require. All reports
and copies thereof are to be directed to the attention of:
▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇, President
▇▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
2.02 The information contained in such reports will be the exclusive property of
the Company.
2.03 The reports and advice of the Consultant are not offered, and will not be
used by the Company for purposes of inducing investment to be made in the
Company unless the consent of the Consultant thereto is first given.
ARTICLE III
INDEMNIFICATION
3.01 In the event the Company shall use the advice or report(s) of the
Consultant in any way as an inducement or representation to others to rely
thereon without the prior consent of the Consultant and such holding out or
representation or inducement shall become the subject of any claim for any
loss, demand, cost, damage, action, suit or proceeding whatsoever, the
Company covenants to indemnify and save the Consultant harmless therefrom,
it being understood that such indemnification shall survive termination of
this Agreement for a period of two years.
ARTICLE IV
ACCOUNTS
4.01 The Consultant shall within fifteen (15) days after the end of each month
during which the Work is performed provide the Company with receipts and
vouchers for out-of-pocket and other expenses incurred and materials
supplied by the Consultant under, and in accordance with, this Agreement
during the period to which such statement relates.
4.02 The Company shall, within fifteen (15) days of receipt at its Houston
office (address below) of each itemized statement of account furnished by
the Consultant, pay the Consultant all costs and charges on disbursements
shown in such itemized statement of account.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
ARTICLE V
TERMINATION
5.01 The term of this agreement shall be 18 months provided that if the Company,
during the 18 month period, terminates its option to purchase the
Tocantinzinho Project, the Company may concurrently terminate this
agreement.
5.02 The Company shall be liable to pay the Consultant for all Work undertaken
and expenses incurred by the Consultant to the effective date of
termination, it being understood that, if the Company has/have requested
the Consultant to engage any person expressly for the Work and such
person's engagement is terminated as a result of operation of this
Subsection, the Company shall be responsible for the employment severance
cost of such person to the Consultant.
ARTICLE VI
ASSIGNMENT
6.01 The Consultant shall not assign any of its rights or obligations under this
Agreement without the prior written consent of the Company.
ARTICLE VII
AMENDMENT OF THIS AGREEMENT
7.01 The terms and conditions of this Agreement may be altered only by written
form of amendment duly executed by both parties hereto.
ARTICLE VIII
NOTICE
8.01 Any notice required or permitted to be given hereunder by any party shall
be deemed to have been given on the day such notice is delivered in writing
to the addresses as set out in the front page of this Agreement or, if
verbal, when communicated personally or by telephone or by email to the
party to whom it is directed and confirmed in writing delivered within
three days; written notice shall be directed to the address of such party
herein before set out or such other address of which written notice may be
given from time to time; notice sent by registered mail will be deemed to
have been delivered at the earlier of the time when the receipt thereof is
signed by the addressee and seventy-two (72) hours after the posting
thereof in any Post Office.
ARTICLE IX
FORCE MAJEURE
9.01 If any party is prevented or delayed from performing any of the obligations
on its part to be performed hereunder by reason of force majeure, including
but not limited to Act of God, strike, threat of imminent strike, fire,
flood, war, insurrection or riot, mob violence or requirement or regulation
of government which cannot be overcome by reasonable and lawful means and
the use of the facilities normally employed in performing such obligation,
then and in any such event, and so often as the same shall occur, any such
failure to perform shall not be deemed a breach of this Agreement and the
performance of any such obligation shall be suspended during the period of
disability. The parties agree to use all due diligence to remove such
causes of disability as may occur from time to time.
ARTICLE X
CONFIDENTIALITY OF INFORMATION
10.01 The Consultant shall take all reasonable precautions to ensure that he and
his employees, if any, keep confidential any information concerning the
Work carried out under this Agreement and, without limiting the generality
of the foregoing, shall instruct his employees and ▇▇▇▇ as confidential any
and all information relating to the project or the Company's programs with
respect thereto and shall prohibit access by any other persons to the
information in the absence of written permission for such access by the
Company.
ARTICLE XI
APPLICABLE LAW
11.01 This Agreement shall be governed by and any dispute arising hereunder
shall be determined in accordance with the laws of the Province of British
Columbia.
ARTICLE XII
DISPUTES
12.01 Any dispute between the parties concerning any matter or thing arising
from this Agreement shall be referred to a mutually agreeable professional
who is knowledgeable in the mining industry.
12.02 The decision of the professional referred to in Subsection 12.01 shall be
final and binding upon the parties.
12.03 Failing agreement on appointment of a professional under Subsection 12.01,
any disagreement or dispute shall be resolved by resort to law and shall be
referred to the jurisdiction of the Courts of the State of Texas.
ARTICLE XIII
OTHER AGREEMENTS
13.01 This Agreement constitutes the complete agreement between the Consultant
and the Company and with respect to subject matter treated herein and shall
not be varied in its terms by oral agreement, representation or otherwise
except an instrument or instruments in writing dated subsequent to the date
hereof and executed by the duly authorized representatives of the
Consultant and the Company, and this Agreement supercedes all prior
agreements, memoranda, correspondence, communication, negotiations or
representations, whether oral or written, express or implied, between the
parties with respect to the subject matter.
ARTICLE XIV
ENUREMENT
14.01 This Agreement shall enure to the benefit of and be binding upon the
parties hereto and their respective successors and permitted assigns.
IN WITNESS WHEREOF the parties have hereunto to have effect, caused their common
seal(s) to be affixed in the presence of their proper officers duly authorized
in that regard the day and year first above written.
STAR RESOURCES CORP.
Per: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
-----------------------
Authorized Signatory
SIGNED, SEALED AND DELIVERED
BY ▇▇▇▇▇▇ ▇▇▇▇▇ in the presence of:
Name
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇
--------------------
▇▇▇▇▇▇ ▇▇▇▇▇
Address
Occupation
SCHEDULE "A"
Description of Work
The Consultant shall be engaged as a consultant to the Company to assist the
Company under the direction of ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇, President, in connection with
the exploration and development of the Tocantinzinho Project and the acquisition
of additional properties in the Tapajos region of Brazil.
Schedule of Consultant's Rates
Fees US$7,000 per month.
Expenses The Company will reimburse the Consultant for all reasonable expenses
properly incurred with prior written authorization of the Company.
Finder's Fee If as a direct result of the activities of the Consultant the
Company or any of its subsidiaries completes an acquisition of additional
mineral interests in the Tapajos Region of Brazil, the Company will grant
to the Consultant an option to purchase not less than 100,000 shares of the
Company for a five year period at the market price at the time of grant of
the option.